In today’s briefing:
- Let’s Talk Aussie Franking Credits
- Early Signs from the Reported March/1Q24 Taiwan Semi/Tech Sales
- Ohayo Japan | US Inflation Rises to 3.5%
- [Blue Lotus Daily]:XPEV/1211 HK/3759HK/1548HK/9926HK/BGNE/9995HK/1801 HK/1810HK/LKNCY/LI/NIO/MNSO US
- Chinese Pharma Longer-Term Outlook
- [Blue Lotus Daily – TMT Update]:700 HK/Douyin/3690 HK/TCOM US/BABA US/NTES US
Let’s Talk Aussie Franking Credits
- To an Australian individual investor, franking credits simply recognise tax already paid by a company on their earnings. These credits may reduce tax you would otherwise pay on dividend income.
- This dividend imputation system prevents double taxation and essentially treats company tax paid as a prepayment of shareholder tax.
- The system makes a lot of sense. It’s a curious thing so few countries have adopted a similar corporate tax structure.
Early Signs from the Reported March/1Q24 Taiwan Semi/Tech Sales
- Y/Y improvement for LCD, PMIC, GaAs RF, gaming card, cooling system, semi equipment&material, semi fab construction, memory, and foundry vendors but more y/y deterioration for WiFi and CMOS sensor vendors
- After 6 vendors beating consensus, we might see AI server supply chain, large panel LCD driver, WiFi/networking, and NAND flash vendors in US to report a better than expected 1Q24.
- We might see 8″/12″ raw wafer (like Shin Etsu, SUMCO , National Silicon Industry, Siltronic AG) vendors in Japan, China, and Germany to report a worse than expected 1Q24.
Ohayo Japan | US Inflation Rises to 3.5%
- US stocks tumbled on Wednesday amid concerns sparked by higher-than-anticipated inflation
- The Japanese currency weakened to over 153 yen versus the dollar, a level not seen since 1990
- Seven & i Holdings unveiled plans to bolster its convenience store business in North America through mergers and acquisitions
[Blue Lotus Daily]:XPEV/1211 HK/3759HK/1548HK/9926HK/BGNE/9995HK/1801 HK/1810HK/LKNCY/LI/NIO/MNSO US
- XPEV US/1211 HK：Didi Autonomous Driving and GAC Aion joint venture approved to launch first commercial L4 model in 2025（///）
- 3759 HK/1548 HK/9926 HK/BGNE US/9995 HK/1801 HK：U.S. biologic drug ban may spread to more CRO companies, positive to Chinese innovative drug companies（/）
- 1810 HK/1211 HK：Lei Jun announced that more than 100,000 people have ordered Xiaomi SU7, and the number of locked orders has exceeded 40,000.（///）
Chinese Pharma Longer-Term Outlook
- Despite the frosty relationship with the US, Chinese exports to the US are thriving.
- Imports as a proxy of local activity were distorted by the Covid trade disruptions, however we expect the uptrend to remain intact.
- The pandemic resulted in an elevation of drug testing. Post a slowdown from the heightened level, development activity remains healthy.
[Blue Lotus Daily – TMT Update]:700 HK/Douyin/3690 HK/TCOM US/BABA US/NTES US
- 700 HK：Tencent’s <Need for Speed Mobile> is set to be released in 3Q24.(+)
- Douyin/3690 HK: Douyin to acquire payment license for local life services biz, implying heightened competition for Meituan.（-）
- TCOM: Railway passenger volume during Qingming holiday expected to reach 111% of 2019 level, showing a decline compared to the Spring Festival.
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